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ABNs & Applying for a Low Doc Loan

ABN: What Is It, Should You Get One and How Is It Used For Home Loans

If you’re going to become a self-employed person, you need to have an ABN (or Australian Business Number). If not, the companies you do business with can hold 46.5 percent of payments that you’re owed for tax reasons.

And, this number will also help you to attain a low doc loan. Thus, registering for one is extremely important.

What’s an ABN?

It’s actually a unique 11-digit number that identifies your business and used when interacting with other companies.   You’ll have to put the ABN number on sales-related documents and invoices. It is also to be used with government agencies like the Australian Tax Office (ATO). And, although it’s dependent on your turnover, you need it to register for GST.

Is getting an ABN worth it to you?

If you want to run your own business, it’s certainly necessary.

In What Others Ways Is The ABN Used?

  • Simplify your business activity statement
  • Claim energy grant credits
  • Claim GST credits
  • Purchase an Australian domain name

How Can You Apply For an ABN?

You have three options in which to apply for your ABN

  • Fill out online application on the Australian Business Register website
  • Paper applications documents can be downloaded through the ATO website
  • Tax agent who can complete the application for you online

Make sure that you fill the information out as clearly and correctly as you can. Mistakes, whether accidental or on purpose, can cost you severely. If you falsify information, you could get hit with a $10,000 fine. A mistake on the ABN application could cost you more than $3,000.

If you are already self-employed and are looking to secure finance to purchase a home, commercial property, equipment for your business or any other valid purpose, contact us today to see how you can qualify for a low doc loan.

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Starting a business?

Click here for more info about registering an ABN.

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Already self-employed and need a loan?  Request a free quote today!

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Low Doc Loans-Solutions for the Self-Employed

Low Doc Loans - Solutions for the Self-employed


ABN: What Is It, Should You Get One and How Is It Used For Home Loans

If you’re going to become a self-employed person, you need to have an ABN (or Australian Business Number). If not, the companies you do business with can hold 46.5 percent of payments that you’re owed for tax reasons.

 

This number will also help you to attain a low-doc home or commercial loan. Thus, registering for one is extremely important.

What is an ABN?

It’s actually a unique 11-digit number that identifies your business and is used when interacting with customers, other companies and businesses.  You’ll have to put the ABN number on sales-related documents and invoices. It also be used with governmental agencies like the Australian Tax Office (ATO). And, although it’s not necessary, you can use it to register for the GST.

Is getting an ABN worth it to you? If you want to start  your own business, it’s certainly a requirement you shouldn’t overlook.

In What Others Ways Is The ABN Used?

  • Simplify your business activity statement
  • Claim energy grant credits
  • Claim GST creditslow doc loans
  • Purchase an Australian domain name
  • Avoid pay-as-you-go tax instalments on monies you receive

How Can You Apply For The ABN?

You have three options in which to apply for your ABN

  • Fill out an online application on the Australian Business Register website
  • Paper applications documents can be downloaded through the ATO website
  • Tax agent who can complete the application for you online

Make sure that you fill the information out as clearly and correctly as you can. Mistakes, whether accidental or on purpose, can cost you severely. If you falsify information, you could get hit with a $10,000 fine. A mistake on the ABN application could cost you more than $3,000.

How Self-Employed People Can Get  Low Doc Loans For Their Home Purchase

Self-employed people have an array of benefits when it comes to using low doc loans to effectively finance their home purchase. However, there are some common misconceptions that go along with self-employed finance.

Low Doc Loans: What Are They?

In simple terms, low doc loans are an easier mortgage finance answer to people who run their own business. These borrowers have the income and assets but cannot give the necessary tax returns or financial statements when due at application time. These loans are generally granted on the basis the applicant self-declares their business income. It’s called a self-certification of income or low doc declaration.

Why Should You Use A Low Doc Loan?

The majority of self-employed people are often too busy and constantly running around and trying to grow their business – than to deal with the financial paperwork necessary for a loan. A good number of business owners have  good cash flow and assets to justify getting the money, but they don’t have current paperwork such as financial statements and tax returns that demonstrate their present financial standing.

In many cases, people who are in business for themselves have fairly complex financial affairs that are geared at decreasing their tax standing. For them, it’s generally much easier for them to attain a low doc home loan.

If you are self-employed then low doc loans may be the solution you are looking for to secure finance. Contact one of our Specialist Lending Managers to discuss your low doc lending options.

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What are Low Doc Loans and How to Get One

What are Low Doc Loans and How to Get One

The process of getting a home loan involves a lot of paperwork. And although this requisite differs from lender to lender, it is mandatory to submit employment or income proof before your loan can be approved.

Unfortunately, there are many instances when this might be a problem for you.

Enter low doc loans.

A low doc loan is a type of loan that requires very little paperwork. The following are the two most common types of borrowers of such loans:-

Small Business Owners

Financing a small business can be difficult. Most conventional lenders need you to provide documents that prove the consistency of your income, which may not be possible to provide in the early stages of a business. Self-employed loans can help you out in such situations.

To obtain one, you need to have a registered Australian Business Number, a minimum deposit against the loan, and documents that verify your business activity, either in the form of a signed letter from your accountant, BAS Statements or the bank statements of your business.

Contractors

Independent contractors, also known as seasonal workers, are at a distinct disadvantage when it comes to loans because they are unable to provide documents that show a consistent source of income (since they only work on short-term or fixed-term basis).

If you are an independent contractor, then low doc loans are your best option because you can easily verify your income by providing the contract of your most recent employment.

Low doc loans in general have the same features as a regular home loan. Therefore, you have the freedom of choice depending on your financial situation.

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commercial real estate

Commercial Real Estate Investment Strategies

Commercial Real Estate Investment Strategies: Do-it-yourself Market Research Pays

One of the strategies commercial real estate investors like to employ is hiring consultants or market research companies to analyse a specific market a commercial real estate investor wants to pursue.

To a beginning investor, the overall strategy seems logical and well-intended.  Who better to know a market than the analysts who spend their days and nights collecting, analysing and reporting on such data?

I’ll tell you:  YOU—the commercial real estate investor.

There is no substitute for doing your own research.  There is no substitute for keeping your own counsel.  There is no substitute for doing your own homework.

Why?

Because it’s YOUR MONEY that will ultimately be spent.  It’s YOUR bank account that will ultimately reflect the success or failure of a commercial real estate endeavour.

Too many well meaning beginning real estate investors think they don’t have what it takes to do the homework required on a market.  Too many well meaning investors yield to their analysis people who supposedly know more about the subject than they do.

This is a costly strategic mistake.

I have nothing against market research people or consultants.  I have no axe to grind with them.  They are extremely competent, thorough people who provide a valuable service.

My issue is with HOW they are used by the commercial real estate investor.

The challenge is when an investor trusts their judgment–more than his or her own.  Many times an investor will be in awe of their command of the information, specifically statistics.

The reason I say this is because I have seen many a real estate investor unwittingly fall victim to this process.  It’s very easy to find yourself yielding to a “professionals” opinion based upon research which you have paid handsomely for.

Don’t.  It is a mistake that will cost you later on.

So what is the proper way to use these market research professionals?  There are three common ways which these professionals are valuable to the commercial real estate investor:

  1. One is as a way to flush out new ideas and do homework and research “heavy lifting” which needs doing that the investor doesn’t have time to accomplish on his or her own.  The investor knows exactly the information he is after.
  1. The second strategy is as a way to confirm the findings which the investor already believes are accurate. In other words, the investor is looking for a second opinion before he commits more resources to the project.
  1. The third strategy is very interesting: Some investor will use professional resources to poke holes in their strategy.  To find the fatal flaw.  To find “the fly in the ointment”.  The investor will never admit this to the professionals, yet he wants to know all the reasons the deal won’t work.

You’ll notice one thing in common with these three strategies:  The investor will always do his own research.  It’s a critical aspect of success—one that should never be delegated.

 

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Looking to invest?

Get Your Free Loan Quote Now!

Are you seeking commercial real estate finance for your new or next investment?

At Sherlock Holmes we are specialist commercial lending advisors and can assist in sourcing flexible loan options tailored to your individual needs. Contact us today for a free quote.

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Low Doc Loans – What Lenders Look For

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Low Doc Loans are an ideal lending solution for people who are self-employed and struggling to secure traditional finance. If you are in the market for a Low Doc Loan, there are several key criteria that lenders look at when assessing your application for approval.

Below is a brief list of these key criteria.

Deposit

As a general rule a minimum 20 per cent deposit is required to secure a low doc loan for residential purposes.  However at Sherlock we have options for low doc loans up to 85% even 90%  – meaning the minimum required would reduce to a 15% or 10% deposit.

Self-employed history

Your ABN is a key component that lenders look at in determining how long you have been in self-employment. Normally a minimum 12-month ABN is required, however the longer you have been self-employed the more agreeable the lender will be.

Assets

If you can show that you hold significant equity in assets that you hold, lenders tend to view your low doc loan application more favourably.

Existing loan repayment history

Lenders will often ask to look at statements on other loan facilities you currently hold to ensure you have a consistent repayment history.

Maximum loan amount/exposure

Low doc home loan lenders will limit the amount of overall lending they will advance to a low doc borrower.  As a general rule this limit is $1 million.  However at Sherlock Holmes we have access to some niche low doc loans that will advance funds in excess of this minimum.

Contact the team at Sherlock Holmes Lending Solutions to find out more about low doc loans and how the options available can be tailored to your needs.